Increasing a brand’s competitive clout: the role of market share,consumer preference,and price sensitivity

The market power (or ‘competitive clout’) of a brand is an increasingly important component of modern marketing strategies. However, the factors that enhance a brand’s competitive clout (BCC) are poorly understood. This study therefore suggests an integrated model of BCC and three factors that are proposed to play a role in its formation: (i) consumer price sensitivity; (ii) brand market share; and (iii) consumer brand preferences. These variables are examined both individually and simultaneously to demonstrate the direct effect of each on BCC and how their inter-relationships contribute to BCC. In doing so, a two-step empirical analysis is conducted. First, two multinomial logit models provide an own- and a cross-price response matrix for a chosen set of competitive brands. Secondly, BCC is regressed against the variables of market share, intrinsic preferences, and price sensitivity using an interaction effects regression model. The results of the analysis show that market share is not the only way to increase BCC; in particular, consumer preferences, and especially pricing decisions, are shown to play a key role in developing a strong brand.     

Retailer Dynamic Pricing and Ordering Decisions: Category Management versus Brand-by-Brand Approaches

This paper provides a framework for retailer pricing and ordering decisions in a dynamic category management setting. In this regard, the key contributions of this paper are as follows. First, we develop a multi-brand ordering and pricing model that endogenizes retailer forward buying and maximizes profitability for the category. The model considers (i) manufacturer trade deals to retailers, (ii) ordering costs incurred by the retailer, (iii) retailer forward buying behavior, and (iv) both own- and cross-price effects of all the brands in the category. Second, we use this model to compare differences in ordering and pricing decisions, and in profits, resulting from using a category management versus a brand-by-brand management approach. Our approach allows us to derive implications in a dynamic setting about the impact of interdependence among the brands upon decisions on pass-through of trade deals and retailer order quantity. We show that category management results in noticeably higher profits versus brand-by-brand and cost-plus (markup) approaches. Further, our results suggest an interaction between a brand's own-price effect and its cross-price effect emerges. If the cross-price effect for a brand is low - that is, the brand takes away relatively few sales from the other brands - the retail pass-through should increase with that brand's own-price effect. On the other hand, when the cross-price effect is high, the retail pass-through decreases with the brand's own-price effect.     

An experimental assessment of alternative teaching approaches for introducing business ethics to undergraduate business students

This study employs a pretest-posttest experimental design to extend recent research pertaining to the effects of teaching business ethics material. Results on a variety of perceptual and attitudinal measures are compared across three groups of students — one which discussed the ethicality of brief business situations (the business scenario discussion approach), one which was given a more philosophically oriented lecture (the philosophical lecture approach), and a third group which received no specific lecture or discussion pertaining to business ethics. Results showed some significant differences across the three groups and demonstrated that for a single lecture, the method used to teach ethics can differentially impact ethical attitudes and perceptions. Various demographic and background variables did not moderate the relationship between the teaching method and the dependent variables, but the sex of the student was strongly associated with the ethical attitude and perception measures. Scot Burton is Assistant Professor of Marketing at Louisiana State University. His research has appeared in the Journal of Marketing Research, the Journal of Consumer Research, and the Journal of Marketing, among others. Mark. W. Johnston is Assistant Professor of Marketing at Louisianna State University. His research has been published in journals such as the Journal of Marketing Research, the Journal of Applied Psychology, and the Journal of Business Research. Elizabeth J. Wilson is Assistant Professor of Marketing at Louisiana State University. Her research has been published in the Journal of Advertising Research and Industrial Marketing Management.     

The influence of non-anonymity deriving from feedback of research results on marketing professionals' research ethics judgements

The study examines, in the context of Crawford's (1970) study items, the influence of non-anonymity deriving from feedback of research results on marketing professionals' research ethics judgements, particularly that of response patterns (social desirability of responses) and item omissions. The results indicate that such non-anonymity does not significantly influence the social desirability of responses or item omissions — thus suggesting the appropriateness of its use to stimulate research ethics responses. Ishmael P. Akaah is Associate Professor of Marketing at Wayne State University. He received his M.B.A., M.A., and Ph.D. degrees from The Wharton School, University of Pennsylvania. His articles have appeared in the Journal of Marketing Research, Journal of Advertising Research, Journal of Health Care Marketing, Journal of Business Research, International Marketing Review, Journal of Global Marketing, Journal of Business Logistics, Journal of the Academy of Marketing Science, Journal of Macromarketing, Journal of Direct Marketing, Journal of Business Ethics, Proceedings of the American Marketing Association, and elsewhere. His current research interests include consumer decision processes, marketing ethics, and international marketing strategy.     

The ethics of psychoactive ads

Many of today's ads work by arousing the viewer's emotions. Although emotion-arousing ads are widely used and are commonly thought to be effective, their careless use produces a side-effect: the psychoactive ad. A psychoactive ad is any emotion-arousing ad that can cause a meaningful, well-defined group of viewers to feel extremely anxious, to feel hostile toward others, or to feel a loss of self-esteem. We argue that, because some ill-conceived psychoactive ads can cause harm, ethical issues must arise during their production. Current pretesting methods cannot identify the potentially psychoactive ads; therefore, we offer some tentative guidelines for reducing the number of viewers harmed by psychoactive ads.No professional, be he doctor, lawyer, or manager, can promise that he will indeed do good for his client. All he can do is try. But he can promise that he will not knowingly do harm.... Peter F. Drucker, Management ... [C]oncern for consumer welfare includes an obligation to critically evaluate all marketing techniques that have indeterminant psychological effects. Spence and Moinpour, 1972, p. 43 Dr. Michael R. Hyman is an Assistant Professor of Marketing at the University of Houston — Clear Lake. He is a member of the American Marketing Association, Institute for Management Science, Academy of Marketing Science, Southern Marketing Association, and World Future Society. His work has appeared in the Journal of Marketing, Journal of Business Research, Journal of Retailing, Business Horizons, and several AMA national proceedings. His current research interests include foundations research and philosophical analyses in marketing. Dr. Richard Tansey is an Instructor of Marketing at the University of Wisconsin — Green Bay. He has his Ph.D. in history from the University of Texas, at Austin, Texas. He received his B.A. in philosophy from the University of West Florida. He minored in philosophy of history and psycho-history while earning his Ph.D. He received a Woodrow Wilson graduate fellowship in philosophy in 1971–1972. His work has appeared in Business Horizons.     

Exploring the structure of ethical attributions as a component of the consumer decision model: The vicarious versus personal perspective

The managerial ethics literature is used as a base for the inclusion of Ethical Attribution, as an element in the consumer's decision process. A situational model of ethical consideration in consumer behavior is proposed and examined for Personal vs. Vicarious effects. Using a path analytic approach, unique structures are reported for Personal and Vicarious situations in the evaluation of a seller's unethical behavior. An attributional paradigm is suggested to explain the results. Joel Whalen is an Assistant Professor of Marketing at DePaul University, Chicago. He has published articles in Psychology & Marketing, Journal of Business Research, and Journal of Business Ethics. His research has been published in the proceedings of the American Marketing Association's Micro-Computers in Marketing Conference; Atlantic Marketing Association; the American Marketing Association Conference on Culture and Sub-Cultural Influences; Northeast Decision Science Institute, Southern Marketing Association, and Decision Sciences Institute. Robert E. Pitts, is Professor and Chair of the Department of Marketing and the Director of the Kellstadt Center for Marketing Analysis and Planning at DePaul University. He served as a member of the faculty of Jacksonville State University, the University of Notre Dame and the University of Mississippi. Dr. Pitts' research has appeared in numerous publications including the Journal of Marketing, Journal of Bank Research, Journal of Advertising, Journal of Consumer Research, Journal of Marketing Education, Journal of Business Research, Journal of Social Psychology, Southern Economic Review, Journal of Travel Research, Journal of Behavioral Economics, The Mid-South Journal of Economics, Psychology and Marketing, Marketing and Media Decisions and Journal of Insurance Issues and Practices. Dr. Pitts is the editor of Personal Values and Consumer Psychology (Lexington Publishers, and co-author of Bank Marketing, A Guide to Strategic Planning, and Effective Bank Marketing Issues, Techniques and Application. Over the past decade, Dr. Pitts has served as a consultant to such firms as General Motors Corporation, Congolium Corp-Kinder Division, National Standard Steel Corp, WalMart Corp Training Programs, Illinois State Chamber of Commerce and Council of State Chambers of Commerce. John K. Wong teaches International Marketing Management and Consumer Behavior at DePaul University. He served as a member of the faculty of the University of Missouri at Columbia and Washington State University. Dr. Wong's research has appeared in numerous publications including the International Marketing Review, Journal of Business Research, Journal of Ambulatory Care Management, International Journal of Bank Marketing and the proceedings of the American Marketing Association, Association for Consumer Research, Academy of Marketing Science, Academy of International Business and Pan-Pacific Business Association.     

Business ethics: A literature review with a focus on marketing ethics

In recent years, the business ethics literature has exploded in both volume and importance. Because of the sheer volume and diversity of this literature, a review article was deemed necessary to provide focus and clarity to the area. The present paper reviews the literature on business ethics with a special focus in marketing ethics. The literature is divided into normative and empirical sections, with more emphasis given to the latter. Even though the majority of the articles deal with the American reality, most of the knowledge gained is easily transferable to other nations. John Tsalikis is an Assistant Professor of Marketing at Florida International University. His articles have appeared in the Journal of the Academy of Marketing Science, Journal of Business Ethics, Journal of International Consumer Marketing, and Psychology and Marketing. David J. Fritzsche is a Professor of Business Administration at the University of Portland. His articles have appeared in the Academy of Management Journal, Columbia Journal of World Business, Journal of Macromarketing, Journal of Marketing Research, Marketing Ethics: Guidelines for Managers, and Research in Corporate Social Performance and Policy.     

A framework for organizational success

The contention of this paper is that the marketing concept is but one aspect of a philosophy of business referred to by the authors as the framework for organizational success. This framework maintains that the marketing concept must work together with good management approaches and with ethical business practices in order to satisfy the needs and wants of the various publics of the organization — customers, employees, suppliers, society — and, in the long run, ensure the satisfaction of the needs of the organization itself. The authors propose that focusing on one concept, and ignoring the other two aspects, is not likely to promote organizational success. Hershey H. Friedman is Professor of Marketing at Brooklyn College. He has published in the Journal of Advertising Research, Journal of Applied Psychology, Akron Business and Economic Review, Journal of the Academy of Marketing Science, Simulation, Journal of the Market Research Society, Journal of Public Policy and Marketing, and the Journal of Business Ethics. Linda Weiser Friedman is Associate Professor of Statistics and Computer Information Systems at Baruch College. She has published in Computers and Operations Research, Behavioral Science, Omega, Simulation, Journal of Statistical Computation and Simulation, Journal of Advertising Research, Interface, and the Journal of the Academy of Marketing Sciences.     

Empirical tests of canonical nonparametric American option‐pricing methods

Alcock and Carmichael (2008, The Journal of Futures Markets, 28, 717–748) introduce a nonparametric method for pricing American‐style options, that is derived from the canonical valuation developed by Stutzer (1996, The Journal of Finance, 51, 1633–1652). Although the statistical properties of this nonparametric pricing methodology have been studied in a controlled simulation environment, no study has yet examined the empirical validity of this method. We introduce an extension to this method that incorporates information contained in a small number of observed option prices. We explore the applicability of both the original method and our extension using a large sample of OEX American index options traded on the S&P100 index. Although the Alcock and Carmichael method fails to outperform a traditional implied‐volatility‐based Black–Scholes valuation or a binomial tree approach, our extension generates significantly lower pricing errors and performs comparably well to the implied‐volatility Black–Scholes pricing, in particular for out‐of‐the‐money American put options. © 2009 Wiley Periodicals, Inc. Jrl Fut Mark 30:509–532, 2010     

Alternative tilts for nonparametric option pricing

This study generalizes the nonparametric approach to option pricing of Stutzer, M. (1996) by demonstrating that the canonical valuation methodology introduced therein is one member of the Cressie–Read family of divergence measures. Alhough the limiting distribution of the alternative measures is identical to the canonical measure, the finite sample properties are quite different. We assess the ability of the alternative divergence measures to price European call options by approximating the risk‐neutral, equivalent martingale measure from an empirical distribution of the underlying asset. A simulation study of the finite sample properties of the alternative measure changes reveals that the optimal divergence measure depends upon how accurately the empirical distribution of the underlying asset is estimated. In a simple Black–Scholes model, the optimal measure change is contingent upon the number of outliers observed, whereas the optimal measure change is a function of time to expiration in the stochastic volatility model of Heston, S. L. (1993). Our extension of Stutzer's technique preserves the clean analytic structure of imposing moment restrictions to price options, yet demonstrates that the nonparametric approach is even more general in pricing options than originally believed. © 2009 Wiley Periodicals, Inc. Jrl Fut Mark 30:983–1006, 2010     

The effectiveness of corporate communicative responses to accusations of unethical behavior

When corporations are accused of unethical behaviour by external actors, executives from those organizations are usually compelled to offer communicative responses to defend their corporate image. To demonstrate the effect that corporate executives' communicative responses have on third parties' perception of corporate image, we present the Corporate Communicative Response Model in this paper. Of the five potential communicative responses contained in this model (no response, denial, excuse, justification, and concession), results from our empirical test demonstrate that a concession is the most effective and robust communicative option.Jeffrey L. Bradford is an Assistant Professor in the Marketing Department at Bowling Green State University. His primary research interests are in the areas of marketing ethics and public policy. His previous research has been published inJournal of Business Ethics, andJournal of Business Strategies.Dennis E. Garrett is an Associate Professor in the Marketing Department at Marquette University. His primary research interests are in the areas of marketing ethics and consumer complaints. His previous research has been published inJournal of Marketing, Journal of Marketing Research, Journal of Business Ethics, Communication Monographs, andBusiness and Society Review. He is also a co-author ofMarketing Theory: Evolution and Evaluation (1988, John Wiley & Sons).     

Social inclusion as a marketing ethics correlate

The author examines, in the context of Litwin and Stringer's (1968) operationalization, the influence of social inclusion (organizational warmth and organizational identity) as a marketing ethics correlate. The results indicate that both organizational warmth and organizational identity underlie marketing professionals' ethical behavior. Furthermore, the influence pattern for each variable is consistent witha priori hypothesis.Ishmael P. Akaah is Associate Professor of Marketing at Wayne State University. His articles have appeared in theJournal of Marketing Research, Journal of Advertising Research, Journal of Health Care Marketing, Journal of Business Research, International Marketing Review, Journal of Global Marketing, Journal of Business Logistics, Journal of the Academy of Marketing Science, Journal of Macromarketing, Journal of Direct Marketing, Journal of Business Ethics, Proceedings of the American Marketing Association, and elsewhere. His current research interests include consumer decision processes, marketing ethics, and international marketing strategy.     

Marketing research interviewers and their perceived necessity of moral compromise

Marketing research interviewers often feel that they must compromise their own moral principles while executing work-related activities. This finding is based on analysis of data obtained from three focus group interviews and a mail survey of 173 telephone survey interviewers. Data from the mail survey were used to construct scales measuring interviewers' perceived necessity of moral compromise, moral character, and job satisfaction. The three scales then were used in a hierarchical regression analysis to predict incidences of interviewers' self-reported proscribed behaviors on the job, the latter being an index of behaviors known by interviewers to be wrong. Results support all hypothesized relationships. James E. Nelson is Associate Professor of Marketing at the University of Colorado at Boulder. Professor Nelson's research interests include topics in survey research, branding and brand equity, and humor in advertising. He has published in the Journal of Marketing, Journal of Advertising, Journal of Business Research, and Journal of Marketing Research. He teaches courses in marketing strategy, marketing research, and multivariate statistics. Pamela L. Kiecker is Associate Professor of Marketing at Virginia Commonwealth University. Professor Kiecker's research interests include topics in survey research, gender and consumer behavior, business ethics, and the dynamics of buyer-seller relationships. She has published in the Journal of Marketing Channels, Journal of the Academy of Marketing Science, Journal of Business Research, Journal of the American Taxation Association, Advances in Consumer Research, and Proceedings of the American Marketing Association. She teaches courses in consumer behavior, advertising and promotion strategy, and marketing ethics.     

Beyond mean estimates of price and promotional effects in scanner-panel sales–response regression

Traditional mean estimates of conditional sales given price and promotion variables may provide misleading guidance about the underlying market mechanisms, since high, low, and medium sales, respectively, may be generated by quite different price and promotion strategies. Empirical evidence for consumer good scanner data reveals nonlinearities and heteroskedasticity in the sales–response relationship—mean effects typically average and hence may obscure a potentially rich nature of observational data. Besides addressing the heterogeneity of price and promotional effects, the proposed quantile regression framework allows direct estimation of monotonicity restricted nonlinear pricing effects for quantiles of the sales distribution.     

Abnormal trading volume and autoregressive behavior in weekly stock returns in the Saudi stock market

This paper examines the relationship between the abnormal change in trading volume of both individual stocks and portfolios and short-term price autoregressive behavior in the Saudi stock market (SSM). Our objective is to investigate the informational role that trading volume plays in predicting the direction of short-term returns. We evaluate whether the abnormal change in lagged, contemporaneous, and lead turnovers affects serial correlation in returns. Specifically, we examine if and when the change in volume produces momentum (positive correlation) or reversal (negative autocorrelation) in consecutive weekly stock returns.We find a reversal in weekly stock returns when conditioned on the change in lagged volume in the SSM. Our results are consistent for the whole sample, the two sub-sample periods, and the large- and small-firm portfolios. The results are consistent with Campbell, Grossman, and Wang [Campbell, J. Y., S. J. Grossman, and J. Wang, 1993, Trading volume and serial correlation in stock returns, Quarterly Journal of Economics, 108, 905–939], who present a model in which risk-averse market makers accommodate the selling pressure of liquidity or non-informational traders. We also find that reversal is more pronounced with the loser portfolio as specified by filter-based methodology. The overall result of this paper is also consistent with the empirical findings of Conrad, Hameed, and Niden [Conrad, J., A. Hameed, and C. Niden, 1994, Volume and autocovariances in short-horizon individual security returns, Journal of Finance 49, 1305–1329.] and Gebka [Gebka, B., 2005, Dynamic volume-return relationship: evidence from an emerging market, Applied Financial Economics, 15, 1019–1029] in which they report price reversal for stock with high trading volume.     

Estimating demand for cellular phone service under nonlinear pricing

Cellular phone carriers typically offer complicated nonlinear tariffs. Consumers make a discrete choice among several rate plans. Each plan has a nonlinear price schedule, and price is usually lower for in-network calls. I present an empirical framework to estimate demand under such nonlinear pricing schemes by using parsimonious carrier-level data and apply the estimation method to analyze the market in Taiwan. I evaluate the impacts of termination-based pricing schemes on the market structure by counterfactual simulations. There is no evidence showing that the network effect resulting from termination-based pricing has significant effects on market structure.

Identifying multiple preference segments from own- and cross-price elasticities

The authors develop an approach to decompose a market-level matrix of own- and cross-price elasticities to reveal potentially overlapping preference segments. The approach is grounded on the premise that markets may be represented by a parsimonious number of relatively homogeneous segments. Market-level elasticities are expressed as functions of segment weights and within-segment market shares. These relationships permit segment weights and within-segment market shares to be estimated from the market-level elasticity matrix and patterns of brand substitutability to be analyzed. The approach is illustrated with data on the grocery coffee category.The authors wish to thank M/A/R/C Inc., Las Colinas, Texas and Information Resources, Inc., Chicago, Illinois for their assistance in collecting the data used in this study. This research was supported in part by the Dean's Fund for Faculty Research of the Owen School.     

The Effects of Firm Size and Industry on Corporate Giving

Recent downward trends in corporate giving have renewed interest in the factors that shape corporate philanthropy. This paper examines the relationships between charitable contributions, firm size and industry. Improvements over previous studies include an IRS data base that covers a much broader range of firm sizes and industries as compared to previous studies and estimation using an instrumental variable technique that explicitly addresses potential simultaneity between charitable contributions and profitability. Important findings provide evidence of a cubic relationship between charitable giving and firm size and evidence of strong industry effects. The plus-minus-plus regression coefficient sign pattern for the cubic firm size model suggests that small and large firms give more relative to total receipts with lower giving ratios among medium size firms. One interpretation for this finding is that small firms are close to the communities they serve while high visibility creates a need for large firm philanthropy. Strong industry effects provide evidence of inter-industry differences in giving culture and/or different public relations requirements across industries. Christie H. Amato (Ph.D., University of Alabama) is professor of marketing at the Belk College of Business Administration, University of North Carolina, Charlotte. Dr. Amato's research interests lie in the area of strategic marketing, productivity, quality of life and ethics. She has published articles in top marketing journals including: Journal of Marketing Research, Journal of the Academy of Marketing Science, Journal of Retailing, Journal of Advertising and Journal of Business Research. Louis H. Amato (Ph.D., University of South Carolina) is professor of economics at the Belk College of Business Administration, University of North Carolina-Charlotte. Dr.␣Amato's research interests lie in the areas of market structure and profitability, productivity, quality of life and ethics. He has published articles in top journals including Southern Economic Journal, Review of Industrial Organization, and Quarterly Journal of Business and Economics.     

Ethical attitudes of mental health practitioners: Balancing therapeutic practices and treatments

This paper reports the responses of 251 mental health care practitioners to a mail survey examining their views concerning ethical conflicts and practices within their work environments. Besides identifying the sources and types of conflicts they experience, respondents were asked how ethical standards have changed over the last 10 years as well as the factors influencing these changes. Conclusions and implications are outlined and future research needs are described.Mohammed Y. A. Rawwas is an Assistant Professor of Marketing at the University of Northern Iowa. His research has appeared in theJournal of Business Ethics, Journal of Hospital Marketing, Health Marketing Quarterly, Medical Marketing & Media, among other journals and proceedings.David Strutton is the Acadiana Bottling Professor of Marketing at the University of Southwestern Lousiana. His research has appeared in theJournal of the Academy of Marketing Science, Journal of Advertising Research, Journal of Business Research, Journal of Macromarketing andJournal of Personal Selling & Sales Management, among other journals and proceedings.Lou E. Pelton is an Assistant Professor of Marketing at the University of North Texas. His research has appeared in theJournal of the Academy of Marketing Science, Journal of Business Research, Journal of Global Marketing, Journal of Macromarketing, andJournal of Personal Selling & Sales Management, among other journals and proceedings.